Wilmington diocese offers $74 million abuse settlement

WILMINGTON, Delaware (Reuters) - The Roman Catholic Diocese of Wilmington, Delaware, has offered $74 million to settle 150 claims of sexual abuse by priests, an increased offer it said would be the largest settlement per case of its kind.

The diocese, which filed for bankruptcy in 2009 due to mounting sex abuse claims dating as far back as the 1950s, said on its website the average payout was about $750,000, far higher than the average in five comparable settlements.

An attorney representing the majority of the purported victims rejected the offer as “woefully inadequate” and said the diocese was misleading about the size of the offer.

“We’re almost half way there to what a reasonable settlement would be,” said Wilmington attorney Thomas Neuberger, who represents 98 people.

Payouts under the new offer would likely range from $75,000 to $3 million, depending on the severity of the alleged abuse, the diocese said on its website.

U.S. Roman Catholic archdioceses have collectively paid some $2 billion in settlements to victims since the priest sex scandals first erupted in Boston nearly a decade ago.

Neuberger criticized the Wilmington diocese for comparing its offer to five settlements obtained in bankruptcy court.

Neuberger said from a legal standpoint a better comparison was the $660 million paid by the Los Angeles archdiocese outside of bankruptcy. The watchdog website BishopAccountability.org estimated the Los Angeles settlement at $780,000 per victim.

The Wilmington Diocese, with a Catholic population of about 233,000, increased its offer from around $55 million after a state jury found that St. Elizabeth Parish owed purported victim John Vai $3 million.

Vai had claimed he was molested as a teenager in the 1960s by Francis DeLuca, a priest who was later defrocked.

Under the latest settlement offer, victims are required to agree to drop all legal action against the diocese and parishes, which are not part of the bankruptcy.

“Lawyers for some survivor-claimants have said that the parishes want to buy their way out of litigation cheaply. But a settlement fund of $74 million ... is hardly cheap,” said a letter from Francis Malooly, the bishop of the Wilmington diocese.

Neuberger said the diocese and parishes combined have $1.7 billion in resources and said the victims had been working on a payout of $1.3 million on average with the prior bishop, who died in 2009.

The settlement was increased by contributions from outside the diocese, including $53 million from a Catholic foundation started 80 years ago by John Raskob, the builder of New York’s Empire State Building.

The Wilmington diocese said its offer was higher than the average claims paid by five other dioceses in bankruptcy court settlements: Fairbanks, Alaska; Davenport, Iowa; Spokane Washington; Tucson, Arizona and Portland, Oregon.

Last week, Milwaukee’s Roman Catholic archdiocese said it would file for bankruptcy due to the financial drain of unresolved lawsuits brought by purported victims of sexual abuse by priests.